Business & Technology

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When additionality always matters

Sean Casten and Adam Stein have been discussing when it is important that a carbon savings be additional -- that is, when it is important that we not pay for a saving that would have happened anyway. You guys are making this way more complicated than it needs to be. Iron-clad additionality is critical when you're selling a permission for someone else to pollute. If you are reducing emissions, generating a financial instrument from that fact, and then selling it to someone else to use as a substitute for reducing their own emissions, your reduction had damn well better be additional. Otherwise, you are almost certainly increasing pollution. You're welcome.

Al Gore's got some big bucks

Thoughts on the newly announced ‘we’ campaign

So Al Gore announced a $300 million 3-year effort "aimed at mobilizing Americans to push for aggressive reductions in greenhouse gas emissions." My question is, wouldn't it be better to spend that money on building grassroots organizations pushing for climate change legislation instead of spending it mostly, I presume, on advertising? If $100 million was spent each year on grassroots organizations in 30 major cities, that would work out to $3 million per each major metropolitan area, enough for a decent-sized effort to organize citizens to push their legislators. Or how about setting up some think tanks and media outlets, as the conservative movement did? Or is raising money for ads much easier than raising money for grassroots organizing? Color me confused.

Got food?

Farmworker Awareness Week is a chance to recognize the people whose labor means we can eat

This is Farmworker Awareness Week, a time to support the millions of farmworkers whose labor puts food on every American table, and who work and live in some of the worst environmental conditions in our nation. It's estimated that 2 to 3 million farmworkers plant, tend, and harvest American crops every year. Many farmworkers in the U.S. are migrants who move from place to place following the harvest. Where I live, in North Carolina, migrant farmworkers are the majority. The average annual income for a farmworker in the United States is about $11,000, or about $16,000 for a farmworking family (though pay on the East Coast is lower than the national average). Farmworkers live in overcrowded housing and very few receive health care or unemployment benefits. Here in North Carolina, about half of our farmworkers cannot afford enough food for themselves and their families.

When does additionality matter? Part 2

Measuring additionality has clear benefits — and also some obvious costs

The second in a series of posts on additionality. In his post criticizing the design of carbon markets, Sean correctly notes that additionality is a pain to measure -- an ever more expensive pain, as the industry matures and quality controls become more stringent. To take an example I know well, at TerraPass, we spend tens of thousands of dollars per project helping dairy farmers validate their methane digesters under the Voluntary Carbon Standard. It's a complex process, requiring a fair amount of domain expertise, outside consultants, site visits, and ongoing monitoring. The process is meant to ensure additionality, but the cost carries some clear downsides. For example, we can't consider any projects that are below a certain size. Even if they're great projects, they won't generate enough carbon reductions to justify the effort. So Sean and I agree that additionality in the carbon world is expensive and tricky to measure, and that the cost of doing so drives some worthwhile projects out of the system.

Carbon policy details: Part 4

Spots vs. strips

This is the fourth post in five-part series on the details required to get carbon policy right. See also parts one, two, and three. We now get into an issue that will seem a bit arcane, because no one's talking about it, at least not explicitly. But it's a real choice, and in many conversations about carbon policy we are implicitly getting it wrong. Should we price carbon in spots, or strips? Or, to take it out of financial jargon, should we: set up markets such that people who are selling or buying emissions credits have to go to the market with each incremental ton to determine what the price will be (a "spot" market), or set up markets such that buyers and sellers can enter into long-term contracts for the emissions they will produce/reduce (a "strip" market)?

Urgency and solvability: The "we" campaign

Gore’s Alliance for Climate Protection unveils ambitious $300 million ad campaign

If you read Juliet Eilperin’s great rundown in the Washington Post, you know that today marks the launch of a massive PR effort from Al Gore’s Alliance for Climate Protection. Gore has concluded that U.S. politicians will continue to be timid on climate change until the public demands otherwise. “The simple algorithm is this: It’s important to change the light bulbs, but it’s much more important to change the laws,” he said. “The options available to civilization worldwide to avert this terribly destructive pattern are beginning to slip away from us. The path for recovery runs right through Washington, D.C.” …

Peak Oil? Bring it on!

Solving the climate problem will solve the peak oil problem, too

I have a new article in Salon on perhaps the most misunderstood subject in energy: peak oil. Here is the short version: We are at or near the peak of cheap conventional oil production. There is no realistic prospect that the conventional oil supply can keep up with current projected demand for much longer, if the industrialized countries don't take strong action to sharply reduce consumption, and if China and India don't take strong action to sharply reduce consumption growth. Many people are expecting unconventional oil -- such as the tar sands and liquid coal -- to make up the supply shortage. That would be a climate catastrophe, and I (optimistically) believe humanity is wise enough not to let that happen. More supply is not the answer to either our oil or climate problem. Nonetheless, contrary to popular belief, the peak oil problem will not "destroy suburbia" or the American way of life. Only unrestrained emissions of greenhouse gases can do that. We have the two primary solutions to peak oil at hand: fuel efficiency and plug-in hybrid electric vehicles run on zero-carbon electricity. The only question is whether conservatives will let progressives accelerate those solutions into the marketplace before it is too late to prevent a devastating oil shock or, for that matter, devastating climate change.

More signs of the Apocalypse?

Soy, corn, and wheat prices puzzling economists

Just in case you weren't worried about rising food prices, The New York Times has an article out that makes the food markets seem even more volatile. Apparently, identical bushels of corn, wheat, and soybeans are selling for two different prices on the derivatives and cash markets.

When does additionality matter? Part 1

The deceptively simple concept at the heart of carbon markets

Sean recently wrote a provocative post on why "additionality" -- one of the bedrock principles of carbon markets as presently designed -- is an expensive waste of time. This is a rich topic, and my perspective as a carbon offset retailer differs from his as an energy producer. It's worth spending a few posts exploring why.

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